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India's Bharti outsources to IBM in a $100 Million deal

When you hear the word 'outsourcing', which country comes to your mind? I bet, it is India. India in the last few years became synonymous with outsourcing and painted a huge colorful picture of itself on the world map because of outsourcing. And recently, India upgraded its image as the Innovation pool and buzzing with 10s of startups incubated every other month.

But in a record deal of $100 Million over the next 7-8 years, India's own Bharti (Airtel brand), the largest private Mobile operator in India, outsourced to IBM to provide better Content delivery platforms targeted for Indian audience.

Read more at Reuters press release and an IBM Case Study (an interview that includes Sunil B.Mittal, Bharti's Chairman.

Though Akhil Gupta argues in the interview (IBM Case Study) that IBM is as much as in Indian company, I do not fully agree. If that is how we define, then every global company, for instance Adobe, Dell, Microsoft, Google, Yahoo and likes which have R&D centers in India are Indian companies. Nah! Thatz not the point. Bharti relied on some thing in IBM that is clearly lacking in India's own IT companies like Wipro, TCS, Infosys and likes.
"Because there was some criticism that, while the world is looking for outsourcing to India, we have done the opposite. And our answer to that was, first, we don't treat IBM as a pure U.S. company. IBM, with 10,000 plus people in India, is as much as an Indian company. After all, when they are expanding in India, they are employing Indians. Two, we have gone for what meets the necessity of the needs of our company. And if that is IBM, so be it"

There has been a growing criticism about Indian IT companies that they are ignoring domestic markets and excessively focusing on US and European markets. And this news of Bharti outsourcing $100 Mil to IBM will sure prove the point of the criticism. India's own IT technology services/product firms, are you listening? IBM is winning the deal in your own court. Where is your strategic advantage of being an Indian company with all that innovation, differentiation and pioneering execution models.

For sure, it creates a clear dent in the image for India's own IT Companies. And to a greater extent, it substantiates the opinion that it is better to have your own development center in India than outsourcing to Indian IT companies.

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